Naira Closes Stronger Tuesday Despite High Demand for Dollar

Transactions closed at the Investors and Exporters (I&E) segment of the foreign exchange (forex) market on Tuesday October 29, 2019 with the Naira appreciating against the US Dollar.

The local currency saw a 4 Kobo or 0.01 percent to trade at N362.05 against a single US Dollar. The Naira had previously traded at N362.09/$1 on Monday at the same window.

However, despite the fact that the value of the domestic currency against the greenback became stronger, the market turnover yesterday rose by 104 percent or $128.35 million. This was because investors were in need of more forex to complete their business transactions.

But the intervention of the Central Bank of Nigeria (CBN) at the market through its weekly supply of $210 million came handy to ease the pressure on the local currency. This ensured that despite the hike in the market turnover on Tuesday, the Naira still appreciated.

Business Post reports that transactions worth $251.36 million were carried out at the investors’ window during the day compared with the $123.01 million exchanged at the previous session.

At the interbank segment of the CBN on Tuesday, data sourced from the FMDQ OTC Securities indicated that the Naira remained unchanged against the Dollar, trading at N307/$1.

A look at the Naira’s performance at the parallel market showed that the domestic currency also remained flat against the three major foreign currencies; the US Dollar, the Euro, and the British Pound Sterling.

An analysis showed that the Nigerian currency, which was sold on Monday at N360 to a Dollar, closed at the same rate on Tuesday at the black market, while it quoted at N400 against the Euro yesterday, the same rate it was the previous session.

In addition, the local currency also remained unchanged against the British Pound at the parallel market at N463/£1 despite the Pound showing a strong performance against other major foreign monies on the back of proposition of an early election ahead of Brexit which has steered many investors away from putting their resources into the United Kingdom.

Adedapo Adesanya is a journalist, polymath, and connoisseur of everything art. When he is not writing, he has his nose buried in one of the many books or articles he has bookmarked or simply listening to good music with a bottle of beer or wine. He supports the greatest club in the world, Manchester United F.C.